TMI Blog2019 (10) TMI 5X X X X Extracts X X X X X X X X Extracts X X X X ..... edit under CCR, 2004 depend on this key question. In the case of COMMISSIONER, CUSTOMS AND CENTRAL EXCISE, AURANGABAD VERSUS M/S ROOFIT INDUSTRIES LTD. [ 2015 (4) TMI 857 - SUPREME COURT] the Hon ble Apex Court had held that since the sale takes place when the ownership shifts to the buyer, where the sale is on FOR basis, the place of removal shifts to the buyer s premises - In the subsequent judgment of the Hon ble Apex Court in the case of COMMISSIONER OF CUSTOMS AND CENTRAL EXCISE, NAGPUR VERSUS M/S ISPAT INDUSTRIES LTD. [ 2015 (10) TMI 613 - SUPREME COURT] categorically held that the buyer s premises can never be the place of removal because the expression is the place from where the goods have to be sold and not from where the goods have been sold. Secondly, it has been held that once the goods reach the buyer s premises, there is no question of removal thereafter as they have already reached the destination. Thirdly, it was being held that the places indicated in the clause such as depot, consignment agent etc., are all places which belong to the seller and not to the buyer. Therefore, the place of removal has to be seller s premises and cannot be buyer s premises. This ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her case, including the case where the goods are not sold, be the value determined in such manner as may be prescribed. ................. 3 (c) place of removal means - (i) a factory or any other place or premises of production or manufacture of the excisable goods; (ii) a warehouse or any other place or premises wherein the excisable goods have been permitted to be deposited without payment of duty; (iii) a depot, premises of a consignment agent or any other place or premises from where the excisable goods are to be sold after their clearance from the factory; from where such goods are removed 3. In other words, wherever the goods are sold at the place other than the factory or warehouse or depot of the manufacturer, such place becomes the place of removal in terms of Section 4. The sale in terms of Section 19(1) of the Sale of Goods Act is where there is a contract for the sale of specified or ascertained goods, the property in them is transferred to the buyer at such time as the parties to the contract intend it to be transferred . In other words, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould not be accepted for delivery. Perusal of the Pos revealed that there were pre-dispatch inspections and goods to be delivered along with the dispatch clearance report provided by the buyer on inspection of the goods at the factory of manufacture or approved inspection report. Any other defects or damages would only be subject to in-process activity for which conditions are laid out which is normal in any contract of supply. Conditions for replacement of goods within specified period is not a consideration for determining the place of supply as the Adjudicating Authority has inferred from the PO examined in para 26.2. The Adjudicating Authority has also arrived at the conclusion in para 26.4 contrary to the conditions noticed by me during my perusal of the PO. Regarding the payment terms, the conditions in the contracts do not debar the appellant from receiving any payments except on non-production of relevant documents as called for by the buyer for settlement of the claim. I find no other conditions available in the purchase orders/ tender or were relied upon by the Adjudicating Authority which binds the appellant to transfer possession of the goods to their buyers at the buye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the costs of the transport incurred in transporting the goods from their premises to the buyer s premises. On the other hand, if the place of removal continues to be the seller s premises then the value cannot include the cost of transportation and transit insurance incurred for transporting the goods from the seller s premises (factory, depot, place of consignment, etc.) to the buyer s premises. Conversely, the assessee will also not be entitled to Cenvat credit of the transport of goods from their factory to the buyer s premises. 8. In the case of Roofit Industries Ltd (supra), Hon ble Apex Court held that where the sale takes place for delivery at buyer s premises (FOR basis) the place of removal gets shifted, under Section 4, to the buyer s premises because that is where the sale in terms of Sale of Goods Act is completed. In terms of Section 4 post 01.07.2000 where under the Act the duty of excise is chargeable on any excisable goods with reference to their value, then on each removal of the goods such value shall, in case, where the goods are sold by the assessee for delivery at the time and place of removal, the assessee and the buyer of the goods are n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ever be the place of removal because the goods have to be sold after their removal and if they are already sold at the buyer s premises nothing more needs to be done. Further, there is no scope for removal once the goods are already sold and reached the buyer s premises. Further, it was also held that if the intention was to include the cost up to the place where goods are to be sold, the expression goods are to be sold must be replaced by goods have been sold . Since goods have to sold from the place of removal, it has to be definitely a place before buyer s premises and it has to be the seller s premises or other premises such as depots and consignment agent which are relatable to the seller. 11. Further, the Hon ble Apex Court has in the case of Ultratech Cement Ltd [2018 (9) GSTL 331 (SC)] dealing with the question of place of removal with respect to the Cenvat credit also held that Cenvat credit from the seller s premises to the buyer s premises is not available even where the sale is on FOR basis. On a review petition filed by the appellant, the Hon ble Apex Court has reaffirmed this decision as reported in 2018 (13) GSTL J101 (SC). In view of the above, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... seller and not to the buyer. Therefore, the place of removal has to be seller s premises and cannot be buyer s premises. 13. This definition of place of removal in both Section 4 and Cenvat Credit Rules does not change depending upon any facts or circumstances of the case. Whether the sale is on FOR buyer s premises basis or otherwise, the judgment of the Hon ble Apex Court in the case of Ispat Industries Ltd (supra) applies. In view of the above, we respectfully disagree with the order of the Tribunal-Ahmedabad and hold that the place of removal has to be the seller s premises only. Accordingly, the demand of differential duty in this case which is based on premise that the place of removal shifts to the buyer s premises in case of FOR basis does not sustain. For this reason, we find no infirmity in the impugned order setting aside the order of the lower authority and dropping the demand, although the reasoning given by the first appellate authority is different. 13. The impugned order is upheld and the appeal is dismissed. (Operative part of this order was pronounced in the open court on conclusion of hearing) - - TaxT ..... X X X X Extracts X X X X X X X X Extracts X X X X
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